Developing an Innovation Toolbox

InnovationManagement spoke to Alexander Osterwalder, sought-after author, speaker, workshop facilitator and adviser on the topic of business model design and innovation. Find out more about his views on innovation management, what projects he is currently working on, and why big organizations should enable their creative innovators.

What is innovation management to you?

It’s about harnessing the knowledge, experience, and passion of a company’s employees in order to continuously create value and increase returns. That means building the right managerial and organizational structures, providing the right incentives, and fostering the right innovation culture that promotes the development and implementation of new ideas. That might sound like a grandiose task, but it can start with something as simple as building meeting rooms with whiteboards and moveable furniture. However, the most important is consistency. You need to show that you’re serious about innovation.

What’s the most satisfying part of your job?

When people who never before have read a business book put our innovation tools to work and get better results. Our team spends an endless amount of time to make the concepts we come up with as simple, as accessible, and as applicable as possible. It’s particularly since my co-author, Yves Pigneur, and I have started working with designer Alan Smith that we achieved a breakthrough. We now strive to change the way business books and business tools look: simple, accessible, and useable. Tackling big questions like that is the most satisfying in my work.

And the most frustrating parts?

When great ideas and passionate innovators get ‘killed’ by internal company politics or 19th century management structures. In many large organizations politics has become more important than value creation. That’s why there’s an urgent need for management innovation: to enable passionate innovators to strive within large organizations and not just as start-up entrepreneurs. Many of the most brilliant innovators will leave their organizations to build their own company because they can’s strive within. The ‘war for talent’ is still a big topic, but I’m not so sure companies really understand what it takes to attract and satisfy innovators. A fat paycheck alone won’t suffice.

What’s your next big challenge?

I’m working on a couple. The first one is about building software-supported tools that boost business model innovation. The challenge is to make them so simple, intuitive and accessible that we can reach new audiences: for example first-time entrepreneurs with a new idea, but no formal business education – all the way to senior executives. Hence, we started working on an app for the iPad with which you can sketch out business model prototypes.

The second challenge I’m working on is to design conceptual tools that helps so-called social entrepreneurs build businesses that make a profit and change the world. Increasingly, business model innovation allows tackling the big issues in the world (e.g. poverty alleviation, sustainability, social issues) with innovative and profitable models.

The third challenge is simply about continuing to grow the tools for (business model) innovation. We are trying to achieve this in an open source manner. We designed some tools to start with, such as the Business Model Canvas, and hope others will contribute to this kernel. For example, we are currently working with Sillicon Valley guru Steve Blank, to integrate his method, Customer Development, with ours. We need an innovation toolbox that goes beyond the individual authors who come up with the methods.

About Alexander Osterwalder

Alexander Osterwalder is a sought-after author, speaker, workshop facilitator and adviser on the topic of business model design and innovation. He has established himself as a global thought leader in this area, based on a systematic and practical methodology to achieve business model innovation. Executives and entrepreneurs all over the world apply Dr. Osterwalderʼs approach to strengthen their business model and achieve a competitive advantage through business model innovation. Organizations that use his approach include 3M, Ericsson, IBM, Telenor, Capgemini, Deloitte, Logica, Public Works and Government Services Canada, and many more. Besides his speaking engagements, Dr. Osterwalder focuses on executive training in the domain of business model development and innovation.